The long-range goal of this project is to determine how large chromosomal domains are transcriptionally inactivated by packaging DNA into heterochromatin. This form of heritable repression inhibits some genes permanently and others in a developmentally regulated manner. Chromosomal translocations that move genes between transcriptionally- poised domains and heterochromatic domains lead to aberrant expression states and diseases. Leukemias and other cancer frequently arise from the inappropriate expression of translocated genes. Genom rearrangements that position a gene near heterochromatin result in an epigenetic pattern of expression: the gene is "off" in some cells and "on" in others and these expression states are maintained stably across many generations. This bimodal pattern of expression is attributed to the clonal propagation of heterochromatin structure that has spread along DNA to varying extents in different cells. In yeast Saccharomyces cerevisiae, genes near telomeres and the silent mating-type loci are repressed by a structure, termed silent chromatin, that bears remarkable similarity to heterochromatin. At the silent mating loci, repression requires cis-actin regulatory sequences, termed silencers, and a set of non-histone chromatin components known as the Sir proteins. To identify basic principles underling heterochromatin- like repression, a host of novel approaches will be used to investigate the structure, stability, and inheritance of silent chromatin in yeast. A primary strategy will involve the use of inducible site-specific recombination to form DNA rings of silent chromatin in vivo. Biochemically isolated rings will be used to analyze the structure and composition of silent chromatin and perform functional studies of transcriptional repression. To investigate silent chromatin stability, the persistence of transcriptional repression in rings uncoupled from chromosomal silencers will be analyzed in vivo. The heritable propagation of silent chromatin will be investigated by analyzing the establishment of the repressive structure on newly replicated templates. Factors that can function as boundaries of silent chromosomal domains will be identify by a simple genetic selection.